Procurement is entering a new era of increasing complexities in which traditional measures of success such as cost savings are no longer the sole focus.
Instead, and as reported in the Deloitte 2021 CPO Survey, "changing business dynamics and increasing layers of complexity" and corresponding "expectations" are transforming the way the industry thinks and acts.
For example, new and more challenging areas such as "climate change, geopolitical stability," and "increasing societal expectations" are now part of the new equation.
The introduction of these emerging variables is causing organizations to re-examine their digital transformation strategies, including how Artificial Intelligence (AI) can help them address the industry's challenges.
The SIG Survey
In 2021 SIG surveyed 100 procurement professionals from Fortune 500 and Global 1000 organizations on digital transformation and AI in procurement.
Based on the results, it is clear that those responding to the survey believe that "procurement's priorities lie with how AI technology can streamline the roles and processes to deliver meaningful and sustainable results."
Unfortunately, and despite the opportunity for more significant gains, the survey reports that "several obstacles" make it difficult for organizations to "bridge the divide" between the promise of digital AI and the realization of its optimal benefits.
Crossing the Divide
Understanding the importance of AI and identifying the challenges with realizing its potential to redefine and empower procurement to achieve critical objectives is the first step to crossing the aforementioned divide.
Mary Zampino, Vice President – Content, Research & Analytics
Kristen Jordeth is the Director of Procurement Product Strategy at SAP. At SIG's Fall Global Executive Summit, Kristen will highlight how the ability to survive future disruptions will be dependent on a companies ability to manage and respond to real-time risk information about third parties transacting with the business.
What is your role and what are your day-to-day responsibilities?
I am the Director of Procurement Product Strategy focusing on future innovations within Supplier Management and the SAP Business Network. My day-to-day responsibilities are to ensure our solutions are addressing the future needs of our customers.
What does Procurement 3.0 mean to you?
Procurement 3.0 means to make the day-to-day procurement process more efficient, transparent and streamlined. Removing tactical procurement that is traditionally done in a spreadsheet or via lots of paperwork and replacing it with technology.
How have you and your team innovated through Procurement’s new “seat at the table”?
Procurement’s new “seat at the table” has validated the need for intelligent enterprise solutions. With Procurement now involved in executive planning, it is important for the procurement processes to connect to all other business processes. At Sapphire this year we announced the SAP Business Network which brings together our SAP Ariba Network, SAP Logistics Network and SAP Asset Network together to expand transparency and enable stronger collaboration.
It’s hard to believe that we are making the final turn into 2022. It has been a wild year, with the Procurement function emerging to the forefront of the business from the pandemic. Procurement 3.0 is here and we continue to lead the conversation.
SIG Global Executive Summit
The SIG team is in overdrive to bring you our first in-person event of the year, the Global Executive Summit. Delegates should come prepared for a state-of-the-art experience that immerses them in industry trends, best practices, innovations and solutions that are shaping high-performance teams and best-in-class procurement organizations.
There’s still time to register for the Fall Global Executive Summit. To learn more about the Summit, check out the Summit website and share it with your team to plan your trip.
Revolutionizing the MRO Supply Chain – The 20 Year Dream That Is Now Achievable with Buyerquest
For Asset Intensive companies, getting a handle on vendors, assets and parts has been a huge problem from a cost, risk, and performance standpoint. Fragmentation and manual processes are time-consuming and limit the opportunity to use business intelligence to deliver new opportunities for success, growth, and innovation in supplier partnerships.
Join this session to learn Skookum’s story, a 30-year leader in Facilities Management and Logistics Support, and their experience solving these problems through digital solutions that revolutionized their MRO supply chain, making a 20-year dream a reality.
As access to COVID-19 vaccines increases and covid variants become increasingly concerning, companies around the world are actively discussing how to build a hybrid work culture, somewhere along the continuum of fully returning and fully remote, with many options in between.
After a year of working from home, the employee mindset has shifted with many people discovering that they enjoy the additional flexibility to balance their family lives while others are “Zoom fatigued” and eager to get back to the office for face-to-face interaction and personal growth. The answer probably lies in a range of options and the phasing of return to office (RTO), creating the “new normal”.
At SMC Squared we’re actively discussing and preparing for RTO for our own teams and guiding many clients. The goal is to continue to maintain a safe environment for an engaged and highly productive workforce. I’ve challenged our management team to rethink how we listen, remain flexible, and importantly retain our employees. We are working to ensure they feel safe returning to the office while also maximizing their opportunities for career growth, collaboration, and mentorship.
It’s not going to be easy as the workplace mindset has rapidly shifted over the last year. Companies must define what a hybrid working model means for them while putting in place different options to balance the needs of the organization and of their people. In addition to the internal challenges, organizations face external factors such as vaccination availability, COVID-19 caseloads, work-life balance, and the highly active and competitive job market.
Patricia Connolly, CEO and Co-Founder, SMC Squared
I often say one of the most satisfying things about my work in procurement is experiencing the diversity across our client base. At WNS Denali, we support Procurement teams across all industries and regions. The way we partner with each client is unique and because each organization has its own challenges specific business objectives, we strive for total business alignment. That requires embracing all the nuances.
With a business-aligned approach, we dive into the core of what makes each client tick. What are the business’s main priorities and what is driving growth? What do stakeholders care about most? What is the business culture like? How are end-users influenced and inspired to drive compliance?
Not surprisingly, we see some notable trends within industries. Across our high-tech industry clients, whether they be software developers, high-tech manufacturing firms, data centers, or other high-growth, innovative organizations, a few key themes influence the solution model:
Alpar Kamber, Executive Vice President & Head Procurement Services, WNS Denali
As we head into the fall of 2021, we prepare for procurement 3.0 with a host of exciting resources, industry research and webinars to elevate you in your role.
September CPO & Executive Virtual Series
SIG's CPO & Executive Virtual Series is an opportunity for the most senior procurement executives to gather with their peers in an interactive virtual environment to discuss their most pressing issues. On September 15, Nitin Khorana, Vice President from Icertis, will explore maximizing supply chain potential with contract intelligence, followed by topic-based discussions on digitalization within procurement and sourcing.
Join us for this executive-level conversation with actionable takeaways.
How to Align Procurement with Third-Party Risk for Successful Vendor Management
One of the biggest challenges that procurement teams face is aligning risk objectives with the rest of the organization. In fact, most companies struggle with ensuring that their risk management processes aren’t perceived internally as a roadblock, slowing down procurement and innovation.
In this webinar, Bryan Littlefair, CEO of Cambridge Cyber Advisers and past Global CISO of Vodafone Group and Aviva, will share his experience designing third-party risk management programs that align with procurement.
Recently, SIG had the pleasure of hosting a panel of Everest Group experts for the July CPO & Executive Virtual Series. The panel included Vice President, Sourcing and Vendor Management, Amy Fong, Chief Research Officer, Michel Janssen, Everest Group Partner, Jimit Arora and Pricing Assurance Partner, Rahul Gehani. It was a very engaging discussion that lasted nearly two hours with tons of excellent takeaways. Let’s get into it!
Trends of the 2020 & 2021 Service Provider Wages
The focus of the meeting was BPO and IT services and the industry trends related to the supply market and successful buy-side organizations. Jimit Arora kicked the roundtable off with the findings from 2020 and early 2021 regarding the rates of IT and BPO services. One of the major points of emphasis was the renegotiating of rates after the dust settled from 2020.
Many of the suppliers realized that the previous rate discounts that were granted during the work-from-home scramble weren’t sustainable. As Jimit stated from Everest Group’s findings, “we are seeing situations where suppliers are going back to their clients saying, Hey, we need to re-up these rates, right?”
A major reason for this change is due to the inflation of the labor market. The question many companies are asking themselves is “how do you get your resources for what you need to accomplish at the correct pay rate, while still making it feasible to where people want to work versus just going on unemployment”. This issue is causing a constraint in general on the market and the talent pool that's available right now. And this remains true whether you view this from a United States perspective or an offshore international perspective.
As demand continues to rock supply chains, we prepare for the future of procurement and risk mitigation with a host of exciting resources, industry research and webinars to elevate you in your role.
August Microlearning by SIG University: Contracting and A Holistic Approach to Risk Management
On August 4, University of Tennessee Faculty, Graduate and Executive Professor Kate Vitasek, and CEO of Commercial Officers Group, Jim Bergman, will explore key concepts around contracting in the new economy. That session will be followed by SIG Hall of Famer and Faculty Member, Lawrence Kane who will join negotiation expert and commercial contracting coach, Jeanette Nyden for a deep-dive discussion on a holistic approach to risk management.
Join your sourcing, procurement, and risk management colleagues in this two-hour interactive virtual environment to be challenged with topics related to our industries!
Demystifying eAuctions – How to Source Smarter, Faster and Better
eAuctions are a great method for helping firms maintain speed to market in an economic environment riddled with scarcity, increased sourcing risk and complexity. The problem? Despite the many benefits that eAuctions offer, they are a grossly misunderstood and underutilized strategy.
In this webinar moderated by SIG, GEP’s Director, Marin Aravind and Senior Associate, Lavanya Krishnan, will demystify eAuctions and share best practices that enable procurement to function as a profit center by improving cost visibility, driving incremental savings, enhancing compliance and optimizing efficiency.
SIG University Certified Supplier Management Professional (CSMP) program graduate Adrienne Westerfield outlines how supplier governance programs and relationships are extremely beneficial to all stakeholders involved and can help drive business success.
What is a governance program? During the SIG University Certified Supplier Management Professional (CSMP) program, while learning unfamiliar governance terminology, I realized I had been involved with creating and establishing various types of governance throughout my career. Supplier governance is a relationship or framework that is mutually agreed upon. Both the company and the supplier benefit from this relationship. The framework can be at a corporate, business unit or contract level depending on the needs and value sought by both parties.
If it is an established relationship that has never been formalized, adding governance will ensure contract compliance. It will mitigate risks for both parties while making sure the objectives of the relationship are met. Over time, the goals for each company may change so that the structure can be re-evaluated accordingly and adjustments made to align with a new direction or specific initiatives. A more structured governance framework will also define the roles and responsibilities for teams, departments and individuals at each company, which will mitigate the risk of any tasks remaining incomplete or done incorrectly.
Adrienne Westerfield, Contract Administrator, Louisville Gas & Electric Company (LG&E)
As a procurement professional, you know that talent in procurement has been a hot topic in recent years. Here at WNS-Denali, we have seen more organizations grapple with talent issues, so we decided to dive deeper into the key talent concerns for retail companies at SIG’s Global Executive Summit a little while back.
The all-star packed panel with procurement leaders from some of the largest retail brands in the world came together to such questions as:
How does your hiring profile differ now and why?
Where are you finding your talent?
What are you looking for in new hires?
Specialist or generalist, which is a better hiring strategy for your team?
Even if you work at a company beyond the retail industry, these questions and the learnings from the panel still apply to your company. As you strive to gain a competitive advantage and influence more spend strategically, refreshing your approach to talent can make a big impact. Below are the top seven creative hiring strategies that came from our panel of retail experts.
Hire from within
This classic retail trick applies to all industries. Promoting from other areas of business up into a corporate role brings a wealth of knowledge and perspective on the core business and ability to relate to stakeholders. Most importantly, it will add a level of credibility to your procurement team.
David Gonzalez, Director, Procurement Services, Denali - A WNS Company